The second-largest U.S. mobile service provider AT&T Inc. (T) has inked a deal with Viacom Inc. (VIA) to add several Viacom channels to its U-verse TV online offerings.

With the AT&T U-verse ID, AT&T customers will now get to view the full-length episodes from BET, Comedy Central, MTV, Nickelodeon, Spike and VH1 on demand through Viacom's network-based websites like www.mtv.tve. Also, customers will soon get the access to these services on their mobile devices including smartphones and tablets.

This is the first “TV Everywhere” offering from AT&T and Viacom. AT&T’s U-verse service offerings are a huge success and gaining strong momentum in the market. Healthy growth from its U-verse video (U-verse TV and bundled satellite) services is helping AT&T to counter increasing competition in the business from its major rivals – Verizon Communications Inc. (VZ) and Sprint Nextel Corp. (S). The U-verse services coupled with support from business revenue, in particular strategic services, are driving the growth in the wireline business.

Revenue from residential customers edged up 1.7% year over year (maximum growth in more than four years) to $5.5 billion in the second quarter, driven by AT&T U-verse services. AT&T's total video subscribers, which include U-verse TV and bundled satellite customers, touched 5.8 million at the end of the second quarter. Total U-verse TV subscribers reached 4.1 million with the net addition of 155,000 customers on continued high-speed Internet attach rates. Strategic business services such as Ethernet, Virtual Private Networks, hosting, IP conferencing and application services, spiked 13.5% year over year.

We believe the expansion of U-verse services will continue to boost data revenue and ARPU (average monthly revenue per user) in the wireline segment.

We are maintaining our long-term Neutral recommendation on AT&T. The company retains the Zacks #3 (Hold) Rank for the short term (1–3 months).

FDA Nod for Bristol-Myers Drug Label Update

Bristol-Myers Squibb Company (BMY) recently announced that the US Food and Drug Administration (:FDA) has cleared a label update for its hepatitis B virus (:HBV) therapy, Baraclude. The FDA has allowed Bristol-Myers to update Baraclude’s label so that data on African Americans and liver transplant recipients suffering from HBV may be included.

The FDA approved the label update on the basis of data from two studies. One study (ETV-085: n=46) evaluated Baraclude in African-American patients suffering from chronic HBV. Another study (ETV-109: n=65) evaluated Baraclude in patients, who had to undergo liver transplant due to HBV related complications.

Baraclude is currently approved for the treatment of chronic HBV in adults with evidence of active viral replication and persistent increase in serum aminotransferases or histologically active disease. The safety and efficacy of Baraclude for treating pediatrics (less than 16 years of age) suffering from HBV has not yet been established.

Even though impressed by the label update of Baraclude, since HBV is an area of concern for the African-American population, we believe that investor focus will remain on how Bristol-Myers fares following the US loss of exclusivity of its blood thinner Plavix on May 17, 2012. Moreover, hypertension treatment Avapro/Avalide went off patent in the US in March 2012.

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